Arne Sorenson
Source: Marriott International, Incorporated.

No 7.7 Percent Raise For Marriott Chief Executive Officer in 2020

Incorrect information has been circulating lately pertaining to the compensation of Arne M. Sorenson, who is the current president and chief executive officer of Marriott International, Incorporated, who was initially slated to receive the first increase in his base salary of $1,300,000.00 in three years…

No 7.7 Percent Raise For Marriott Chief Executive Officer in 2020

…but due to the current 2019 Novel Coronavirus pandemic, not only will that increase in salary not be realized; but Sorenson also voluntarily committed to receiving no base salary for the remainder of the year effective as of April of 2020, according to the following paragraph which is found on page 34 of the official Schedule 14A filing of Marriott International, Incorporated to the Securities and Exchange Commission of the United States:

At its meeting in February 2020, following a comprehensive review of market data, the Committee determined to increase the base salaries by 7.7% for Mr. Sorenson and by approximately 3% for the other NEOs. The increase for Mr. Sorenson was the first increase to his base salary since 2017. However, in March 2020, in light of the rapidly evolving coronavirus (COVID-19) situation, the Committee discussed with management the appropriateness of adjusting senior executive compensation as part of the Company’s numerous initiatives to mitigate the negative financial and operational impacts of COVID-19. Mr. Sorenson recommended that he receive no base salary (except as necessary for benefit deductions) for the remainder of the year and the other NEOs requested, and Mr. Sorenson recommended, that they receive 50% of their base salary for the remainder of the year, in each case beginning in April 2020. The Committee and Board accepted these recommendations.

Last month, Sorenson delivered the somber news of the state of Marriott International, Incorporated via this video which was shared on Twitter

…as well as through this business update on Wednesday March 18, 2020; and this update on Wednesday, April 8, 2020.

Marriott International, Incorporated is the largest lodging company in the world, with almost 1,400,000 rooms in approximately 7,300 hotel and resort properties under 30 brands worldwide — but since the current 2019 Novel Coronavirus pandemic, the overall business operations in general has been reduced by almost 75 percent below normal levels, which Sorenson claimed is significantly worse than the global financial crisis of 2007 and 2008 and the incidents which occurred on Tuesday, September 11, 2001 combined.

Approximately 66 percent of the 4,000 corporate employees at the headquarters in Bethesda in Maryland — as well as members of corporate staff abroad — have been slated to be furloughed between 60 days and 90 days as they receive a significant fraction of their salaries; while members of corporate staff who are not furloughed are subject to pay cuts of 20 percent and reduced workweeks.

This is all in addition to the decision to begin furloughing what executives at Marriott International, Incorporated expected to be tens of thousands of staff members of hotel and resort properties.

“Take, for example, Marriott International, the world’s largest hotel chain, which last year earned $1.2 billion. It has begun furloughing most of its American workers, jeopardizing their access to health care, even as the company paid out more than $160 million in quarterly dividends and pursued a raise for its chief executive, Arne M. Sorenson”, according to this article written by for The New York Times. “Mr. Sorenson, a co-chairman of the Business Roundtable’s task force on Covid-19, declined a request for an interview.”

The article then focuses on a married couple — both of whom work for hotel properties which are under the brand portfolio of Marriott — who have since lost their jobs and the combined income of approximately $1,700.00 per week…

…but the article neglects to mention that many hotel and resort properties are operated by franchisees and not by Marriott International, Incorporated itself. One chief executive officer of a franchise company which operates some hotel and resort properties that are under the brand portfolio of Marriott is taking a cut in pay of approximately 75 percent; the salaries of executive employees of that franchise company have been reduced by half; and property level managers have had their salaries reduced by 30 percent — all of which is to last for a minimum of two months before they are re-evaluated. Although hourly employees will still receive their pay as normal, 6,500 of the 9,000 employees of that franchise company have lost their jobs.

“Guess I’ll be eating a lot of ramen noodles, if I can find any at the grocery store!” is what one employee of that franchise company — who prefers to remain anonymous — said to me.

Compensation for Executives of Marriott International, Incorporated

The following Summary Compensation Table presents the compensation which was paid in fiscal years 2017, 2018 and 2019 to the chief executive officer, chief financial officer and the other three most highly compensated executive officers of Marriott International, Incorporated.

Click on the image for an enlarged view. Source: Marriott International, Incorporated.

Although the base salary of Arne M. Sorenson is $1,300,000.00 per year and has been unchanged since 2017, his total compensation of $13,453,887.00 is the most which he has received in each of those three years…

…but note that slightly less than half of that compensation is $6,182,815.00 in stock awards in 2019. The stock price of a share of Marriott International, Incorporated was worth $151.43 on Tuesday, December 31, 2019. As of today, Tuesday, April 14, 2020, that same share is worth $82.68, which represents a reduction of greater than 45 percent, which could mean that the stock awards for Sorenson may possibly be worth $3,400,548.00. With that assumption — ceteris paribus, or other things being equal — the total compensation for Sorenson for 2020 could be worth $9,353,620.00 instead of $13,435,887.00…

…but of course, anything can change between now and the end of the year 2020.


I am simply attempting to conduct a fact check to quell the misplaced growing anger at the accusation of Arne M. Sorenson accepting a raise in pay of 7.7 percent during the 2019 Novel Coronavirus pandemic while employees are being furloughed — and I believe that the aforementioned article from The New York Times was written in such a way as to unnecessarily fuel that fire.

That is not to say that the disparity between wealthy corporate executives and employees of the same company is not staggering. In fact, the following statement on page 54 in the aforementioned filing by Marriott International, Incorporated admits that disparity:

The 2019 annual total compensation of the median compensated employee was $38,878; Mr. Sorenson’s 2019 annual total compensation was $13,435,887, and the ratio of these amounts was 1-to-346.

Although I understand that Sorenson has undergone medical issues from which I hope that he recovers completely, I believe that he could demonstrate even more of a leadership role by voluntarily foregoing — or donating — more of his compensation to those who truly need it in these difficult times.

In fact, I believe that more leaders should be modeling the way — something which has been notably absent — more than ever during these difficult times due to the 2019 Novel Coronavirus pandemic.

Source: Marriott International, Incorporated.

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!